Avoiding Red Flags in Company Footnotes (with Michelle Leder)

An 8-K filing announces company news investors might want to know about – “material news” in shorthand. About 40 of them get filed on a typical Friday before 4pm, when the stock market closes. 

And in the 90-minute window after 4pm but before the SEC closes at 5:30pm? Another 150. 

Companies, in other words, are deliberately waiting to dump their (likely bad) news.

This trick doesn’t fool Michelle Leder, founder of Footnoted.com, a service serving sophisticated investors and regulators that parses through financial filing fine print to uncover unsavory news that companies may, at least allegedly, be trying to hide there. 

Michelle has found plenty over the past two decades – sudden resignations, new risk factors, and more. She sat down to talk with me about footnote red flags, going wide vs. going deep when looking at companies, the challenge of companies not disclosing enough vs. disclosing too much, AI-created filings being read by AI filing reading tools, the futility of shareholder voting, how she would change financial reporting if she could wave a magic wand over GAAP and IFRS standards, and more. 

Please click here or on the image below to watch.


This article is for informational purposes only and is neither investment advice nor a solicitation to buy or sell securities. All investment involves inherent risks, including the total loss of principal, and past performance is not a guarantee of future results. Always conduct thorough research or consult with a financial expert before making any investment decisions. Neither the author nor BBAE has a position in any investment mentioned.

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